FOR INFORMATION PURPOSES ONLY

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1 P7_TA-PROV(2011)0116 Consumer rights ***I Proposal for a directive of the European Parliament and of the Council on consumer rights (COM(2008)0614 C6-0349/ /0196(COD)) (Ordinary legislative procedure: first reading) The proposal was amended on 24 March 2011 as follows 1 : AMENDMENTS BY PARLIAMENT * to the Commission proposal DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on consumer rights (Text with EEA relevance) THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, and in particular Article 114 thereof, Having regard to the proposal from the European Commission, Having regard to the opinion of the European Economic and Social Committee 2, Having regard to the opinion of the Committee of the Regions 3, Acting in accordance with the ordinary legislative procedure 4, Whereas: 1 * The matter was then referred back to committee pursuant to Rule 57(2), second subparagraph (A7-0038/2011). This provisional consolidated version of the amendments adopted by Parliament on 24 March 2011 has been prepared by Parliament's Directorate for Legislative Acts for information purposes only. Certain necessary technical adaptations have been made but the text has not yet been finalised in accordance with Rule 180(2) of Parliament's Rules of Procedure. OJ C 317, , p. 54. OJ C 200, , p. 76. Position of the European Parliament of

2 (1) Council Directive 85/577/EEC of 20 December 1985 to protect the consumer in respect of contracts negotiated away from business premises 1, Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts 2, Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the protection of consumers in respect of distance contracts 3, Directive 1999/44/EC of the European Parliament and of the Council of 25 May 1999 on certain aspects of the sale of consumer goods and associated guarantees 4, lay down a number of contractual rights for consumers. (2) Those Directives have been reviewed in the light of experience with a view to simplifying and updating the applicable rules, removing inconsistencies and closing unwanted gaps in the rules. That review has shown that it is appropriate to replace those four Directives by this single Directive. This Directive should accordingly lay down standard rules for the common aspects and move away from the minimum harmonisation approach in the former Directives under whilst allowing which Member States could to maintain or adopt stricter national rules, in relation to certain other aspects, providing for a higher level of consumer protection. Amendment 1 (3) Article 169(1) and Article 169(2)(a) of the Treaty on the Functioning of the European Union (TFEU) provide that the Union is to contribute to the attainment of a high level of consumer protection by the measures it adopts pursuant to Article 114 thereof. (4) In accordance with Article 26(2) TFEU, the internal market comprises an area without internal frontiers in which the free movement of goods and services and freedom of establishment are ensured. The harmonisation of certain aspects of consumer contract law is necessary for the promotion of a real consumer internal market striking the right balance between a high level of consumer protection and the competitiveness of enterprises, while ensuring the respect of the principle of subsidiarity. (5) The cross-border potential of distance selling which should be one of the main tangible results of the internal market is not fully exploited by consumers. Compared with the significant growth of domestic distance sales over the last few years, the growth in cross-border distance sales has been limited. This discrepancy is particularly significant for Internet sales for which the potential of further growth is high. The cross-border potential of contracts negotiated away from business premises (direct selling) is constrained by a number of factors including the different national consumer protection rules imposed upon the industry. Compared with the growth of domestic direct selling over the last few years, in particular in the services sector (e.g. utilities), the number of consumers using this channel for crossborder purchases has remained flat. Responding to increased business opportunities in many Member States, small and medium size enterprises (including individual entrepreneurstraders) or agents of direct selling OJ L 372, , p. 31. OJ L 95, , p. 29. OJ L 144, , p. 19. OJ L 171, , p

3 companies should be more inclined to seek business opportunities in other Member States, in particular in border regions. Therefore the full harmonisation of certain aspects of consumer information and the right of withdrawal in distance and off-premises contracts will contribute to thea high level of consumer protection and better functioning of the business to consumer internal market. Amendment 2 (6) The laws of the Member States on consumer contracts show marked differences which can generate appreciable distortions of competition and obstacles to the smooth functioning of the internal market. The existing Community legislation in the field of consumer contracts concluded at a distance or away from business premises, consumer goods and guarantees as well as unfair contract terms establishes minimum standards for harmonising legislation allowing the Member States the possibility to maintain or introduce more stringent measures which ensure a higher level of consumer protection in their territories. Furthermore, many issues are regulated inconsistently between directives or have been left open. These issues have been addressed differently by the Member States. As a result, the national provisions implementing directives on consumer contract law diverge significantly. Amendment 3 (7) These Certain disparities in the Member States legislation in the field of consumer contracts, particularly distance contracts or off-premises contracts, create significant internal market barriers affecting business traders and consumers. They increase compliance costs to businesstraders wishing to engage in cross border sale of goods or provision of services. Disproportionate fragmentation also undermines consumer confidence in the internal market. The negative effect on consumer confidence is strengthened by an uneven level of consumer protection across the Community. This problem is particularly acute in the light of new market developments. Amendment 4 (8) Unless otherwise specified and in accordance with Article 169 TFEU, the provisions of this Directive should not hinder the Member States from adopting or maintaining more stringent measures of national law, which improve consumer protection. However, the full harmonisation of some key regulatory aspects will is justified in order to secure a single regulatory framework for consumer protection and in order to considerably increase legal certainty for both consumers and businesstraders in cross-border business. Both In this case, both consumers and businesstraders will be able to rely on a single regulatory framework based on clearly defined legal concepts regulating certain aspects of business-to-consumer contracts across the Union. The effect will be to Thus, the consumer will enjoy a high common level of protection across the Union. Furthermore, by establishing uniform rules at Union level, this should eliminate the barriers stemming from the disproportionate fragmentation of the rules and to complete the internal market in this area. These barriers can only be eliminated by establishing uniform rules at Community level. Furthermore consumers will enjoy a high common level of protection across the Community. Amendment 5 3

4 (9) The field harmonised by this Directive should cover certain aspects of business to consumer contracts. These are rules on information to be provided before conclusion and during performance of the contract, the right of withdrawal for distance and off-premises contracts, consumer rights specific to contracts of sale and unfair contract terms in consumer contracts. (10) The provisions of this Directive should be without prejudice to Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations (Rome I) 1. (10a) (10b) This Directive should not apply to healthcare, that is to say health services provided by health professionals to patients to assess, maintain or restore their health. Amendment 6 Gambling activities, including lottery and betting transactions, should be excluded from the scope of this Directive in view of the very specific nature of those activities, in the light of which Member States should be able to adopt other, including more stringent, consumer protection measures in relation to such activities. Amendment 7 (11) The existing Community Union legislation on inter alia relating to consumer financial services or package travel contains numerous rules on consumer protection. For this reason the provisions of this Directive cover contracts relating to financial services only insofar as this is necessary to fill the regulatory gaps., Articles 5 to 19 and Article 23a of this Directive should not apply to contracts relating to financial services and Articles 9 to 19 should not apply to distance and off-premises contracts relating to package travel, without prejudice to other provisions of existing Union legislation. With regard to financial services, Member States should be encouraged to draw inspiration from existing Union legislation in that area when legislating in areas not regulated at Union level, in such a way that a level playing field for all consumers and all contracts relating to financial services is ensured. The Commission should aim at complementing Union legislation in the field of financial services in order to close existing gaps and protect consumers in all types of contracts. Amendment 8 (11a) (11b) Articles 9 to 19 of this Directive should be without prejudice to the application of the provisions of the Member States relating to the acquisition of immovable property and guarantees relating to immovable property or the formation or transfer of rights in rem in immovable property. This includes agreements connected with such legal acts, such as sales of immovable property still to be developed and hire-purchase. Amendment 9 As no difficult psychological situation applies when contracts, in accordance with the provisions of the Member States, are established by a public office-holder, such contracts should be excluded from the scope of Articles 9 to 19 of this Directive. Amendment 10 1 OJ L 177, , p. 6. 4

5 (11c) (11d) (11e) For the purposes of this Directive, leasing contracts for motor vehicles, where the motor vehicle is returned at the end of the contract, should be considered as motor vehicle rental services. Amendment 11 Many Member States have chosen to apply national consumer protection rules to other entities such as non-governmental organisations, start-up businesses and small and medium-sized enterprises, and other Member States may wish to do so. It should be recalled that Member States may extend the scope of the national rules adopted in order to implement this Directive to cover natural or legal persons who are not consumers within the meaning of this Directive. Amendment 12 Digital content transmitted to the consumer in a digital format, where the consumer obtains the possibility of use on a permanent basis or in a way similar to the physical possession of a good, should be treated as goods for the application of the provisions of this Directive which apply to sales contracts. However, a withdrawal right should only apply until the moment the consumer chooses to download the digital content. Amendment 13 (12) The new definition of distance contract should cover all cases where sales and service contracts concerning the supply of a good or the provision of a service are concluded between the trader and the consumer under an organised distance sales or service-provision scheme and without the simultaneous physical presence of the parties, using exclusively one or more means of distance communication (such as mail order, Internet, telephone or fax). Websites offering only information on the trader, his goods and/or services should not be covered by the definition of such an organised distance sales or service-provision scheme, even if such websites indicate one or more means of distance communication. This should create a level playing field for all distance traders. It should also improve legal certainty as compared to the current definition requiring the presence of an organised distance selling scheme run by the trader up to the conclusion of the contract. Amendment 14 (13) The particular circumstances under which an offer was made or the contract was negotiated should not be relevant in the definition of a distance contract. The fact that the trader is an occasional distance seller or that he uses an organised distance sales or service-provision scheme run by a third party such as an online platform, should not deprive consumers of their protection. Similarly, a transaction negotiated face to face between the trader and the consumer away from business premises should be a distance contract, if the contract has then been concluded through the exclusive use of means of distance communication, such as the Internet or telephone. For traders, a simpler definition of a distance contract should improve legal certainty and protect them from unfair competition. Amendment 15 (14) An off-premises contract should be defined as a contract concluded with the simultaneous physical presence of the trader and the consumer, away from business premises, for example at the consumer's home or workplace. In an off-premises context, consumers are under temporarily in a special situation 5

6 which is different from the situation in a shop, for instance from a psychological pressure point of view and as regards the scope for comparing goods and prices, no matter whether they have solicited the trader's visit or not. Furthermore, in order to prevent circumventions of rules when consumers are approached away from business premises, a contract negotiated, for example at the consumer's home but concluded in a shop should be regarded as an off-premises contract only when the main components of the contract have been determined in the course of an excursion, a leisure event or a sales demonstration. Nevertheless, contracts under which the payment to be made by the consumer does not exceed EUR 40 should not be covered by the information requirements laid down in this Directive, so that for instance street traders, whose goods are supplied immediately, are not overburdened with obligations as regards information. A right of withdrawal is also unnecessary in such cases, since the implications of such contracts are readily understandable. Nevertheless Member States should remain free, and be encouraged, to set a lower value. Amendment 16 (15) Business premises should include premises in whatever form (such as shops, taxis or lorries) which serve as a permanent place of business activity for the trader. Market stalls and fair stands should be treated as business premises even though they may be used by the trader on a temporary or regular basis. Other premises which are rented for a short time only and where the trader is not established (such as hotels, restaurants, conference centres, cinemas rented by traders who are not established there) should not be regarded as business premises. Similarly, all public spaces including public transport or facilities as well as private homes or workplaces should not be regarded as business premises. Amendment 17 (16) The definition of Durable media medium should include in particular documents on paper, USB sticks, CD-ROMs, DVDs, memory cards and or the hard drive of the computer disks of computers. In order to qualify as a "durable medium", an on which the electronic mail or a pdf file is a website should firstly enable the consumer to store the information for as long as it is relevant for him to protect his interests stemming from his relationship with the trader. Secondly, the electronic mail or website should allow for the information to be stored in such a way as to make it impossible for the trader to change it unilaterally. Amendment 18 (17) ConsumersThe consumer should be entitled to receive given comprehensive information before the conclusion of the he is bound by an on-premises contract, a distance contract, an off-premises contract or a corresponding contract offer. However traders should not have to provide the information when already apparent from the context. For example in an on-premises transaction, the main characteristics of a product, the identity of the trader and the arrangements for delivery may be apparent from the context. In distance and off-premises transactions, the trader should always provide the information on arrangements for payment, delivery, performance and the complaint handling policy, since these might not be apparent from the context. In providing that information, the trader should take into account 6

7 the specific needs of consumers who are particularly vulnerable because of their mental, physical or psychological infirmity, age or credulity in a way which the trader could reasonably be expected to foresee. However, taking into account such specific needs should not lead to different levels of consumer protection. Amendment 19 (17a) Notwithstanding the exemption for the trader to provide the information set out in Article 9 on a durable medium when concluding an off-premises mixed contract for which the trader and the consumer immediately perform their contractual obligations and the payment to be made by the consumer does not exceed EUR 200, the consumer should nevertheless be given comprehensive information by the trader on the essential points of the contract, especially as regards the price, before the consumer is bound by that contract. Amendment 228 (18) Traders should be obliged to inform consumers in advance of any arrangement resulting in the consumers paying a deposit to the trader, including an arrangement whereby an amount is blocked on the consumers' credit or debit card. (19) In the case of public auctions, due to the nature and tradition of that sales method, the auctioneer may instead of communicating the geographical address and the identity of the seller for whom he is selling the goods replace that with his own contact details. (20) The consumer should know whether he is contracting with the trader or with an intermediary acting on behalf of another consumer, since in the latter case the consumer may not enjoy the protection under this Directive. Therefore the intermediary should inform of this fact and the consequences thereof. The notion of intermediary should not include online trading platforms which do not conclude the contract in the name of or on behalf of any other party. Amendment 20 (21) In the case of distance contracts, the information requirements should be adapted to take into account the technical constraints of certain media, such as the restrictions of the number of characters on certain mobile telephone screens or the time constraint on television sales spots. In this case the trader should comply with a minimum set of information requirements and refer the consumer to another source of information, for instance by providing a toll free telephone number or a hypertext link to a webpage of the trader where the relevant information is directly available and easily accessible. (22) Since in the case of distance sales, the consumer is not able to see the good before concluding the contract he should have a right of withdrawal, which allows him to so that, until the expiration of the withdrawal period, he can ascertain the nature, quality and functioning of the goods. Such a right of withdrawal should also be granted for off-premises contracts. Amendment 21 (23) The current varying lengths of the withdrawal periods both between the Member States and for distance and off-premises contracts cause legal 7

8 uncertainty and compliance costs. The same withdrawal period should apply to all distance and off-premises contracts. (24) To ensure legal certainty, it is appropriate that Council Regulation (EEC, Euratom) No 1182/71 of 3 June 1971 determining the rules applicable to periods, dates and time limits 1 should apply to the calculation of the periods contained in this Directive. Therefore, all periods contained in this Directive should be understood to be expressed in calendar days. Amendment 22 (25) The rules on distance contracts should be without prejudice to the provisions on the conclusion of e-contracts and the placing of e-orders as set out by Articles 9 and 11 of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Directive on electronic commerce). (26) When the consumer orders more than one good from the same trader, he should be entitled to exercise the right of withdrawal in respect of each of these goods. If the goods are delivered separately Where goods are supplied in more than one delivery, the withdrawal period should start when begin from the day on which the consumer acquires the material possession of each individual good. or a third party other than the carrier and indicated by the consumer acquires the material possession of the first partial shipment. Where a good is delivered in different lots or pieces, the withdrawal period should start when begin from the day on which the consumer or a third party indicated by the consumer acquires the material possession of the last lot or piece. If multiple goods are ordered by the consumer in one order and but are delivered separately, the withdrawal period should start when the consumer acquires possession of the last good. Amendment 23 (27) If the trader has not informed the consumer on the right of withdrawal prior to the conclusion of a distance or off-premises contract, the withdrawal period should be extended. However, in order to ensure legal certainty over time, a three-month one-year limitation period should be introduced, provided that the trader has fully performed his contractual obligations. The trader should be regarded as having fully performed his obligations when he has delivered the goods or has fully provided the services ordered by the consumer. However, Member States should be allowed to maintain existing national legislation to extend that limitation period. Amendment 24 (28) Differences in the ways in which the right of withdrawal is exercised in the Member States have caused costs for businesses selling cross-border. The introduction of a harmonised standard withdrawal form to be used by that the consumer may use should simplify the withdrawal process and bring legal certainty. For these reasons, Member States should refrain from adding any presentational requirements to the Community-wide Union-wide standard form relating for example to the font size. However, the consumer should remain free to withdraw using his own chosen wording, provided that his 1 OJ L 124, , p. 1. 8

9 statement to the trader is clearly worded. Sending back the goods, sending a letter or a making a telephone call could also meet this requirement, but the burden of proof for demonstrating having withdrawn within the time limits specified in this Directive may be on the consumer. For this reason, it is in the interest of the consumer to make use of a durable medium when communicating his withdrawal to the trader. Amendment 229 (29) As experience shows that many consumers and traders prefer to communicate via the trader's website, there should be a possibility for the trader to give the consumer the option of filling in a web-based withdrawal form. In this case the trader should provide an acknowledgement of receipt by without delay. (30) In case of withdrawal the trader should reimburse all payments received from the consumer, including those covering the expenses born by the trader to deliver goods to the consumer, with the exception of payments for express deliveries at the express wish of the consumer. Reimbursement should be possible by any means of payment, provided they are legal tender in the Member State where the consumer receives it. Therefore, reimbursement shall not take place in the form of vouchers or credit notes. Amendment 26 (31) Some consumers exercise their right of withdrawal after having used the goods to an extent more than necessary to ascertain the nature and functioning of the good. In this case the consumer should be liable for any diminished value of the goods. In order to ascertain the nature and functioning of a good, the consumer should only handle or try it in the same manner as he would be allowed to do in a shop. For example, the consumer should only try on a garment and should not be allowed to wear it. In order to ensure the effectiveness of the withdrawal right in service contracts, in particular for non-urgent renovation works for which consumers may be subject to high pressure selling at their homes followed by the immediate performance of the service before the expiration of the withdrawal period, consumers should bear no cost for such a service. (32) In order to avoid the trader reimbursing a consumer who has not returned the goods, the consumer should be required to send back the goods no later than fourteen days after having informed the trader about his decision to withdraw. By the same token, the trader should also be enabled to make reimbursement subject to the condition that the consumer has supplied evidence of having sent back the goods. Amendment 230 (33) Certain exemptions should exist from the right of withdrawal, such as in cases where a right of withdrawal would be inappropriate given the nature of the product, and exercising a right of withdrawal would unfairly disadvantage the trader. That is applicable in particular to foodstuffs and other hygienically sensitive or perishable goods, for example to wine supplied a long time after the conclusion of the contract of a speculative nature where the value is dependent on fluctuations in the market (vin en primeur). Certain other goods or services whose price is dependent on 9

10 market fluctuations, for instance commodities such as fuel oil, should also be exempt from the right of withdrawal. Amendment 231 (34) Furthermore, in case of distance and off-premises contracts for the provision of services, for which the performance begins during the withdrawal period (e.g. for instance data files downloaded by the consumer during that period), it would be unfair to allow the consumer to withdraw after the service has been enjoyed by the consumer in full or in part. Therefore the consumer should lose his right of withdrawal when performance begins with his prior express agreement, provided that such agreement constitutes informed consent, that is to say that the consumer has been informed of the consequences of this decision in terms of losing his right of withdrawal. Amendment 28 (35) The Commission has found some key consumer problems in the home improvement sector where consumers are under high pressure to order expensive renovation works. The scope of the information and withdrawal rules should be clarified and extended in order to cover this kind of contract. Only contracts for the conveyance of interests in real property should be excluded from the scope of the rules on information and withdrawal rights applicable to distance and off-premises contracts. (36) The application of a right of withdrawal may be inappropriate for certain services relating to accommodation, transport and leisure. The conclusion of the corresponding contracts implies the setting aside of capacity which, if a right of withdrawal was introduced, the trader may find difficult to fill. Therefore these distance contracts should not be covered by the provisions on consumer information and the right of withdrawal. (37) For the purpose of simplification and legal certainty, the right of withdrawal should apply to all types of distance and off-premises contracts, except under strictly defined circumstances which can easily be proved. Therefore, no right of withdrawal should apply for urgent repairs at the consumer's home for which such a right of withdrawal would be incompatible with the emergency situation as well as for supermarket home-delivery schemes which allow consumers to select food, drinks and other goods intended for current consumption in the household through the supermarket's website and have them delivered at their home. These are goods, which are inexpensive and bought regularly by consumers for their every day's consumption or everyday use in the household and should therefore not be subject to a right of withdrawal. The main difficulties encountered by consumers and the main source of disputes with traders are about delivery of goods, including goods getting lost or damaged during transport and late and partial delivery. Therefore it is appropriate to clarify and harmonise the national rules on delivery and passing of risk. Amendment 29 (37a) The main difficulties encountered by consumers and the main source of disputes with traders concern delivery of goods, including goods getting lost or damaged during transport and late or partial delivery. Therefore it is 10

11 appropriate to harmonise the national rules on delivery and passing of risk. Amendment 30 (37b) Where the trader has failed to fulfil his obligations to deliver the goods, the consumer should call upon him, on a durable medium, to make the delivery within no less than seven days and notify him of his intention to withdraw from the contract if delivery does not take place. The consumer should be deemed to have withdrawn from the contract if no action has been taken by the time the deadline expires. Without prejudice to his rights to claim damages, the consumer should be entitled to reimbursement within seven days of withdrawal if payment has already been made. It should be possible for Member States to adopt or maintain provisions of national law, in order to ensure a higher level of consumer protection. Amendment 31 (38) In the context of consumer sales, the delivery of goods can take place in various ways. Only a rule which may be freely derogated from will allow the necessary flexibility to take into account those variations. : either immediately or at a later date. If the parties have not agreed on a specific delivery date, the trader should deliver the goods as soon as possible but in any event not later than thirty days from the day of the conclusion of the contract. The consumer should be protected against any risk of loss or damage of the goods occurring during the transport arranged or carried out by the trader. The rule introduced on the passing of risk should not apply where the consumer unduly delays taking possession of the goods (for example, when the goods are not collected by the consumer from the postoffice within the deadline fixed by the latter). In those circumstances, the consumer should bear the risk of loss or deterioration after the time of delivery as agreed with the trader. Amendment 32 (38a) In many transactions consumers are provided with insufficient choices of means of payments or they are charged if they refuse to use certain means. This situation should be addressed by means of a provision which ensures that the trader will offer to the consumer different means of payment and, in the case of distance contracts, these should include both electronic and non-electronic means of payment. An example of a non-electronic system of payment would be the printing of an order from the trader s website to be paid in cash at a bank or at any other contact point of the trader. Amendment 33 (39) The trader should be liable to the consumer if the goods are not in conformity with the contract. The goods should be presumed to be in conformity with the contract if they satisfy a number of conditions concerning mainly the qualities quality and quantity of the goods. The quality and performance which consumers can reasonably expect will depend inter alia on whether the goods are new or second-hand as well as on the expected life-span of the goods. Where goods other than those ordered have been delivered, or in the event of undershipment, the goods should be presumed not to be in conformity with the contract. Amendment 34 11

12 (40) If the good is not in conformity with the contract, firstly, the consumer should have the possibility to require the trader to repair the goods or to replace them at the trader's choice unless the trader proves that those remedies are unlawful, impossible or causes the trader disproportionate effort. The trader's effort should be determined objectively considering costs incurred by the trader when remedying the lack of conformity, the value of the goods and the significance of the lack of conformity. The lack of spare parts should not be a valid ground to justify the trader's failure to remedy the lack of conformity within a reasonable time or without a disproportionate effort.the consumer should in the first instance have the option of requiring the trader to repair the goods or to replace them unless those remedies are impossible or disproportionate. Whether or not a remedy is disproportionate should be determined objectively. A remedy should be considered disproportionate if it imposes, in comparison with other remedies, unreasonable costs. In order to determine whether the costs are unreasonable, the costs of one remedy should be significantly higher than the costs of another remedy. Amendment 35 (41) The consumer should not bear any costs for remedying the lack of conformity, particularly the cost of postage, labour and materials. Furthermore, the consumer should not compensate the trader for the use of the defective goods. The consumer should be entitled to claim damages, in accordance with provisions of applicable national law, for any loss resulting from lack of conformity with the sales contract and not remedied by the trader. It should be possible for such damages to include nonpecuniary damages where applicable national law so provides. Amendment 36 (42) When the trader has either refused or has more than once failed to remedy the lack of conformitythe consumer should be entitled to choose freely any of the available remedies. The trader's refusal can be either explicit or implicit, meaning in the latter case that the trader does not respond or ignores the consumer's request to remedy the if he is not entitled to have the goods repaired or replaced. It should be possible for Member States to adopt or maintain provisions of national law on the free choice of remedies in the event of lack of conformity, in order to ensure a higher level of consumer protection. Amendment 37 (42a) (42b) It should be stipulated that in certain cases the trader may be held liable for a lack of conformity that existed at the time the risk was transferred to the consumer, even if the lack of conformity becomes apparent only subsequently. Amendment 38 Where the trader, as final seller, is liable to the consumer because of an act or omission by the producer, it should be ensured that the trader, as final seller, can pursue remedies against the person or persons liable in the contractual chain. To this end, Member States' national provisions should determine the person or persons liable, together with the relevant actions and procedure. Amendment 39 12

13 (42c) With regard to lack of conformity, the consumer should be entitled to a two-year liability period. There should be a rebuttable presumption in the consumer's favour that any lack of conformity which has become apparent within six months after the risk passed to the consumer already existed when the risk passed. It should be possible for Member States to adopt or maintain provisions of national law on liability periods, duration for reversal of the burden of proof or specific rules on significant lack of conformity which becomes apparent after the liability period, in order to ensure a higher level of consumer protection. Amendment 40 (43) Directive 1999/44/EC allowed the Member States to set a period of at least two months during which the consumer was to inform the trader of any lack of conformity. The diverging transposition laws have created barriers to trade. Therefore, it is necessary to remove this regulatory option and improve legal certainty by obliging consumers to inform the trader of the lack of conformity within two months from the date of detection. Amendment 41 (44) Some traders or producers offer consumers commercial guarantees. In order to ensure that consumers are not misled, the commercial guarantees should include certain information, including their duration, territorial scope and a statement that the commercial guarantee does not affect the consumer's legal rights under the national provisions in force and those laid down in this Directive. Amendment 42 (45) There is a need to protect consumers against unfair contract terms which have not been individually negotiated, such as standard contract terms. The rules on unfair terms should not apply to terms which the consumer agreed upon following a negotiation. Being afforded the possibility to choose between different contract terms which have been drafted by the trader or a third party on behalf of the trader should not be regarded as a negotiation. (45a) The harmonised regulatory aspects concern only contracts concluded between traders and consumers. Therefore, the provisions on unfair contract terms should not affect national law in the area of contracts relating to employment, contracts relating to succession rights, contracts relating to family law and contracts relating to the incorporation and organisation of companies or partnership agreements and bond terms. Amendment 43 (46) Provisions on unfair contract terms should not apply to contract terms, which directly or indirectly reflect mandatory statutory, regulatory or regulatory public policy provisions of the Member States which comply with Community Union law. Similarly, contract terms should reflect the principles and provisions of the Charter of Fundamental Rights of the European Union. Terms which reflect the principles or provisions of international conventions to which the Community Union or the Member States are party, particularly in the transport area, should not be subject to the unfairness test. Amendment 44 (47) Consumer contracts shouldall contract terms should be expressed in a clear and comprehensible manner. If a contract term is in writing, it should 13

14 always be drafted in plain, intelligible language and be legible. Traders should be free to choose the font type or size in which the contract terms are drafted. The consumer should be given an opportunity to read the terms before concluding the contract. This opportunity could be given to the consumer by providing him with the terms on request (for on-premises contracts) or making those terms otherwise available (e.g. on the trader's website in respect of distance contracts) or attaching standard terms to the order form (in respect of off-premises contracts). The trader should seek the consumer's express consent to any payment in addition to the remuneration for the trader's main contractual obligation. Inferring consent by using optout systems, such as pre-ticked boxes online should be prohibited. Amendment 45 (47a) Traders should be free to choose the way in which contract terms are communicated, for example the font type or size in which the contract terms are drafted. Member States should refrain from imposing any presentational requirements, except for those related to persons with disabilities or where the goods or services may present a particular risk to the health and safety of the consumer or a third person. Member States may also seek to impose additional requirements where, due to complexities inherent in contracts for such goods or services, there is a risk of consumer detriment including issues arising which relate to competition in that sector. This may apply, for example, to contracts relating to financial services, gas, electricity and water, telecoms and immovable property. However, this should not apply to formal national requirements concerning the conclusion of the contract or other formal requirements such as for instance the language of the terms, requirements on the content of the terms or the formulation of certain contract terms for specific sectors. This Directive should not harmonise language requirements applicable to consumer contracts. Therefore, Member States should be able to maintain or introduce in their national law linguistic requirements relating to the contractual terms. Amendment 46 (48) When making an assessment of good faith, particular regard should be made to the strength of the bargaining positions of the parties, whether the consumer was induced to accept the term and whether the goods or services were sold or supplied on the special order of the consumer. The requirement of good faith may be satisfied by the trader where he deals fairly and equitably with the other party whose legitimate interests he should take into account. (49) For the purposes of this Directive, neither the fairness of terms which describe the main subject matter of the contract, nor the quality/price ratio of the goods or services supplied should be assessed unless these terms did not meet transparency requirements. The main subject matter of the contract and the price/quality ratio should nevertheless be taken into account in assessing the fairness of other terms. For example, in insurance contracts, the terms which clearly define or circumscribe the insured risk and the insurer's liability should not be subject to such an assessment since these restrictions are taken into account in calculating the premium paid by the consumer. This 14

15 exclusion does not apply to the remuneration foreseen for the trader from ancillary or contingent charges set out in the contract, including fees or charges for breaching any of the terms of the contract, which should be fully subject to the fairness test. Amendment 47 (50) In order to ensure legal certainty and improve the functioning of the internal market, the Directive should contain two non-exhaustive lists of unfair terms. Annex II contains a list of terms which should in all circumstances be considered unfair. Annex III contains a list of terms which should be deemed unfair unless the trader proves otherwise. These same lists should apply in all Member States. Amendment 48 (51) The measures necessary for the implementation of this Directive should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission 1. Amendment 49 (52) In particular, the Commission should be empowered to amend Annexes II and III on contract terms to be considered or presumed unfair. Since those measures are of general scope and are designed to amend non-essential elements of this Directive, they must be adopted in accordance with the regulatory procedure with scrutiny provided for in Article 5a of Decision 1999/468/EC. Amendment 50 (53) The Commission's power to amend Annexes II and III should be used to ensure consistent implementation of the rules on unfair terms by supplementing those Annexes with contractual terms, which should be considered unfair in all circumstances or which should be deemed unfair unless the trader has proved otherwise. Amendment 51 (54) The Member States may use any concept of national contract law which fulfils the required objective that unfair contract terms should not be binding on the consumer. (55) The Member States should ensure that their courts or administrative authorities have at their disposal adequate and effective means of preventing the continued application of unfair terms in consumer contracts. (55a) The Member States should ensure that their national authorities have the necessary level of cooperation with the European Consumer Centre (ECC) network, so as to react in cross-border cases, especially on pending requests at ECCs. Amendment 52 (56) In accordance with the TFEU, the Directive provides for a high level of consumer protection. Nothing in this Directive prevents traders from offering consumers contractual arrangements which go beyond the protection afforded by this Directive. 1 OJ L 184, , p

16 (57) Persons or organisations regarded under national law as having a legitimate interest in protecting consumer contractual rights should be afforded legal remedies for initiating proceedings, either before a court or before an administrative authority which is competent to decide upon complaints or to initiate appropriate legal proceedings. (58) It is necessary that Member States lay down penalties for infringements of the provisions of this Directive and they must ensure that these are enforced. The penalties should be effective, proportionate and dissuasive. (59) The consumer should not be deprived of the protection granted by this Directive. Where the law applicable to the contract is that of a third country, Regulation (EC) No 593/2008 of the European Parliament and of the Council on the law applicable to contractual obligations (Rome I) should apply, in order to determine whether the consumer retains the protection granted by this Directive. (60) The European Commission, following consultation with the Member States and stakeholders, will look into the most appropriate way to ensure that all consumers and traders are made aware of their rights at the point of sale. The Commission should avail itself especially of the means provided by information and communication technology tools and public media. Amendment 53 (61) Since inertia selling, which consists of unsolicited supplies of goods or services to consumers, is prohibited by Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC, Directives 97/7/EC, 98/27/EC and 2002/65/EC of the European Parliament and of the Council and Regulation (EC) No 2006/2004 of the European Parliament and of the Council ( Unfair Commercial Practices Directive ) 1 but no contractual remedy is provided thereof, it is necessary to introduce in this Directive the contractual remedy of exempting the consumer from the provision of any consideration for such unsolicited supplies. (61a) 1 Provision should be made for a mutual evaluation process in which, during the transposition period for this Directive, Member States would first have to screen their legislation in order to ascertain what stricter provisions, which are compliant with the TFEU, are to be maintained or adopted in their national law in order to ensure a higher level of protection for the consumer. By the end of the transposition period for this Directive, Member States should draw up a report on the results of this screening. The Commission should submit each report to all other Member States and stakeholders. Member States and the European Parliament would then have six months in which to submit their observations on those reports. Not later than one year after the end of the transposition period for this Directive, and every three years thereafter, the Commission should draw up a report, accompanied where appropriate by legislative proposals. If OJ L 149, , p

17 necessary, the Commission could assist the Member States in devising a common method. Amendment 54 (61b) To ensure a high level of consumer protection in all Member States, persons and organisations with a legitimate interest in consumer protection should be encouraged to notify the Member States and the Commission about their evaluations and issue non-binding recommendations so that they can be taken into account when this Directive is reviewed. Amendment 55 (62) Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic communications) 1 already regulates unsolicited communications and provides for a high level of consumer protection. The corresponding provisions on the same issue contained in Article 10 of Directive 97/7/EC should be deleted. (63) It is appropriate to review this Directive if some barriers to the internal market were identified. The review could lead to a Commission proposal to amend this Directive, which may include amendments to other consumer protection legislation reflecting the Commission's Consumer Policy Strategy commitment to review the acquis in order to achieve a high, common level of consumer protection. Amendment 56 (64) Directives 85/577/EEC, 93/13/EEC, 97/7/EC and 1999/44/EC should be repealed. (65) Since the objectives of this Directive cannot be sufficiently achieved by the Member States and can therefore be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to eliminate the internal market barriers and achieve a high common level of consumer protection. (66) This Directive respects the fundamental rights and observes the principles recognised in particular by the Charter of Fundamental Rights of the European Union, HAVE ADOPTED THIS DIRECTIVE: Chapter I Subject matter, definitions and scope Article 1 Subject matter 1 OJ L 201, , p